Inergy Executes Binding Commercial Agreements on North-South Project

Inergy, L.P. (NASDAQ: NRGY) (“Inergy”) announced today that its wholly owned, regulated subsidiary Central New York Oil And Gas Company, LLC (“CNYOG”) has executed the binding precedent agreements necessary for the filing of regulatory approvals and construction of the previously announced North-South Project.

The North-South Project is expected to provide firm wheeling services to shippers desiring to move natural gas volumes bi-directionally to / from the Tennessee Gas Pipeline, Stagecoach hub, Stagecoach South and North Lateral receipt and delivery points, and Millennium Pipeline. Inergy has reached commercial terms and executed precedent agreements with shippers who participated in its non-binding open season. The agreements provide the commercial support necessary for Inergy to proceed with its development plans. Inergy expects the transportation capacity of the North-South Project to be in excess of 250,000 Dth/day, with the weighted average term of the agreements being approximately five years in duration.

“This project was met with overwhelming demand, and it provides an excellent opportunity to leverage our storage and transportation capabilities with the needs of our customers and the market to provide access to the Marcellus Shale natural gas supply,” said John Sherman, President and CEO of Inergy, L.P. “The North-South Project, when combined with our future plans for a MARC I hub line, will allow Inergy to maximize the utilization of existing infrastructure and provide investors with stable demand-driven returns from this organic growth opportunity.”

“We are very pleased to have obtained sufficient commitment from parties to allow us to continue moving forward with our expansion plans,” said Bill Moler, Senior Vice President, Inergy Midstream. “We look forward to meeting the expectations of our expansion customers and to the continuation of superior service to our existing customer base.”

Inergy will be sponsoring a “binding open season” to determine the final size and scope of the project in the next three weeks. Inergy expects to file a Natural Gas Act 7(c) application with the Federal Energy Regulatory Commission for a certificate of public convenience and necessity in the Spring of 2010 and anticipates the North-South Project to be placed into service by late 2011.

About Inergy, L.P. and Inergy Holdings, L.P.

Inergy, L.P., headquartered in Kansas City, Mo., is among the fastest growing master limited partnerships in the country. The Company’s operations include the retail marketing, sale, and distribution of propane to residential, commercial, industrial, and agricultural customers. Today, Inergy serves nearly 800,000 retail customers from over 300 customer service centers throughout the United States. The Company also operates a 40 Bcf natural gas storage business; a liquid petroleum gas storage business; a solution-mining and salt production company; and a propane supply logistics, transportation, and wholesale marketing business that serves independent dealers and multi-state marketers in the United States and Canada. Inergy Holdings, L.P.’s assets consist of its ownership interest in Inergy, L.P., including limited partnership interests, ownership of the general partners, and the incentive distribution rights.

About Central New York Oil And Gas Company, LLC

Central New York Oil And Gas Company, LLC is a wholly owned subsidiary of Inergy, L.P. Central New York Oil And Gas Company, LLC is a New York limited liability company formed to construct, expand, and operate the existing Stagecoach natural gas storage facility located 150 miles northwest of New York City in Tioga County, New York. For more information about Central New York Oil And Gas Company, LLC, go to www.stagecoachstorage.com.

This news release contains forward-looking statements, which are statements that are not historical in nature, such as the expectation that Inergy will file its Natural Gas Act 7(c ) application in the next three weeks, that Inergy will receive the necessary regulatory approvals for the North-South Project, that the North-South Project will provide shippers the expected firm transportation capacity, that Inergy will construct the proposed North-South Project, and that the project will be placed into service by late 2011. Forward-looking statements are subject to certain risks, uncertainties, and assumptions. Should one or more of these risks or uncertainties materialize, or any underlying assumption prove incorrect, actual results may vary materially from those anticipated, estimated, or projected. Among the key factors that could cause actual results to differ materially from those referred to in the forward-looking statements are: weather conditions that vary significantly from historically normal conditions, the demand for high deliverability natural gas storage capacity in the Northeast, the general level of natural gas and other hydrocarbon product demand, the availability of natural gas, the price of natural gas to the consumer compared to the price of alternative and competing fuels, our ability to successfully implement our business plan for midstream expansion, our ability to generate available cash for distribution to unitholders, the outcome of certificate and rate decisions issued by the Federal Energy Regulatory Commission, and the costs and effects of legal, regulatory, and administrative proceedings against us or which may be brought against us. These and other risks and assumptions are described in Inergy’s annual report on Form 10-K and other reports that are available from the United States Securities and Exchange Commission.

Corporate news, unit prices and additional information about Inergy, including reports from the United States Securities and Exchange Commission, are available on the company’s Web site, www.InergyLP.com. For more information, contact Mike Campbell in Inergy’s Investor Relations Department at 816-842-8181 or via e-mail at investorrelations@inergyservices.com.

Inergy Holdings, L.P. (MM) (NASDAQ:NRGP)
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